REVENUE ESTIMATING CONFERENCE Tax: Insurance Premium Tax Issue: Local Pension Reform Bill Number(s): CS/SB172 - Enrolled Entire Bill Partial Bill: Sponsor(s): Sen. Bradley Month/Year Impact Begins: 7/1/2015 Date of Analysis: 6/1/2015 Section 1: Narrative a. Current Law: Section 175.101, Florida Statutes, authorizes municipalities and special fire control districts having lawfully established

firefighters’ pension trust fund or other fund providing pension benefits to firefighters to levy an excise tax of 1.85% of the gross amounts of insurance premiums collected on property insurance contracts. Section 185.08, Florida statutes, authorizes each incorporated municipality with an eligible municipal police officers’ retirement trust fund or other fund providing pension benefits for police officers may impose an excise tax of .85% of the gross amount of insurance premiums collected on casualty insurance policies covering property. Section 175.351, Florida Statutes, provides in part that for any municipality, special fire control district, local law municipality, local law special fire control district, or local law plan under this chapter, in order for municipalities and special fire control district s with their own pension plan for firefighters , or for fire fighters and police officers if included, to participate in the distribution of the tax fund established under 175.101, a local law plan must meet the minimum benefits and minimum standards and income from the premium tax shall be used to pay extra benefits. Further defines extra benefits and additional premium tax revenues. Section 185.35 reads similarly.

b. Proposed Change: revises section 175.351 and section 185.35 to eliminate the definitions of extra benefits and additional premium tax revenues. Deletes the requirement that additional revenues must be used to provide for extra benefits. Defines base premium tax revenues to be mean (a) For a local law plan in effect on October 1, 2003, the revenues received by a municipality or special fire control district pursuant to s. 175.121 or s. 185.10 for the 2002 calendar year. (b) For a local law plan created between October 1, 2003, and March 1, 2015, inclusive, the revenues received by a municipality or special fire control district pursuant to s. 175.121 or by a municipality pursuant to s. 185.10 based upon the tax collections during the second calendar year of participation. Defines “Additional Premium Tax Revenues” to mean revenues received by a municipality or special fire control district pursuant to 175.121 or by a municipality pursuant to s. 185.10 which exceed base premium revenues. Defines “Special benefits” means benefits provided in a defined contribution plan for firefighters and police officers, respectively. Provides that the base premium tax revenues must be used to fund minimum benefits or other retirement benefits in excess of the minimum benefits as determined by the municipality or special fire control district and that fifty percent of additional premium revenues received that are in excess of the amount received for the 2012 calendar year must be used to fund minimum benefits or other retirement benefits in excess of the minimum benefits as determined by the municipality or special fire control district, and 50 percent must be placed in a defined contribution plan to fund special benefits.

Section 2: Description of Data and Sources Section 3: Methodology (Include Assumptions and Attach Details) Currently 190 municipalities or special districts receive premium tax revenues pursuant to chapters 175 and 185. This premium tax operates as a direct credit against the state insurance premium tax. Currently the credit for chapters 175 185 premium tax is $223.3 M. Impact would only occur is more municipalities or special districts that were eligible to impose the tax and had not are induced by the changes in the bill to levy the tax. Section 4: Proposed Fiscal Impact

High Middle Low

Cash Recurring Cash Recurring Cash Recurring

2015-16

2016-17

2017-18

2018-19

2019-20

List of affected Trust Funds: General Revenue only Section 5: Consensus Estimate (Adopted: 06/03/2015): The Conference adopted for GR – 0/(**) and Local – 0/** to total to 0.

GR Trust Local/Other Total

Cash Recurring Cash Recurring Cash Recurring Cash Recurring

2015-16 0/(**) 0/(**) 0/** 0/** 0.0 0.0 0.0 0.0

2016-17 0/(**) 0/(**) 0/** 0/** 0.0 0.0 0.0 0.0

2017-18 0/(**) 0/(**) 0/** 0/** 0.0 0.0 0.0 0.0

2018-19 0/(**) 0/(**) 0/** 0/** 0.0 0.0 0.0 0.0

2019-20 0/(**) 0/(**) 0/** 0/** 0.0 0.0 0.0 0.0

X

344

REVENUE ESTIMATING CONFERENCE Tax: Home Medical Product Seller License Fees Issue: Electrostimulation medical equipment seller licenses Bill Number(s): HB 1305 Entire Bill: Partial Bill: Sponsor(s): Representative Eagle Month/Year Impact Begins: Date of Analysis: June 2, 2015 Section 1: Narrative a. Current Law: Licensure Required. Locations that sell, rent, or distribute home medical equipment and services must obtain a license from the Agency for Health Care Administration (AHCA). See s. 400.93, F.S.; Rule 59A-25.002, F.A.C. “Home medical equipment” is broadly defined. It includes products regulated by the Federal Drug Administration, products reimbursed under the Medicare Part B Durable Medical Equipment benefits, and products reimbursed under the Florida Medicaid durable medical equipment program. Representative items include oxygen and related respiratory equipment; wheelchairs and related seating and positioning equipment; motorized scooters; personal transfer systems; and specialty beds. See s. 400.925, F.S.

Several home medical equipment providers are exempted from licensure, such as providers operated by the Department of Health or the federal government, licensed nursing homes, licensed assisted living facilities, licensed home health agencies. See s. 400.93(5), F.S. Fees. Each location where home medical equipment is sold, rented, or distributed is subject to a biennial application fee of $304.50 and a biennial inspection fee of $400. While each location is subject to the application fee, businesses with central service centers and distribution centers must only pay a single $400 inspection fee, which is for the central service center. See Rule 59A-25.002, F.A.C. Locations that are inspected by accrediting organizations are exempted from the inspection fee. See s. 400.933(2), F.S.

b. Proposed Change: The bill exempts physicians licensed under chapters 458, 459 or 460 from home medical equipment provider licensure for the sale or rental of electrostimulation medical equipment to patients in the course of their practice. Section 2: Description of Data and Sources AHCA

Section 3: Methodology (Include Assumptions and Attach Details) The average number of licensees from 2012-2014 and current license fees were used to estimate future license revenue. The methodology assumes that only 22 percent of licensees are also required to pay the inspection fee.

Section 4: Proposed Fiscal Impact

High Middle Low

Cash Recurring Cash Recurring Cash Recurring

2015-16 (*) (*)

2016-17 (*) (*)

2017-18 (*) (*)

2018-19 (*) (*)

2019-20 (*) (*)

X

539

REVENUE ESTIMATING CONFERENCE Tax: Home Medical Product Seller License Fees Issue: Electrostimulation medical equipment seller licenses Bill Number(s): HB 1305 List of affected Trust Funds: Section 5: Consensus Estimate (Adopted: 06/03/2015): The Conference adopted the proposed estimate.

GR Trust Local/Other Total

Cash Recurring Cash Recurring Cash Recurring Cash Recurring

2015-16 (*) (*) (*) (*) 0.0 0.0 (*) (*)

2016-17 (*) (*) (*) (*) 0.0 0.0 (*) (*)

2017-18 (*) (*) (*) (*) 0.0 0.0 (*) (*)

2018-19 (*) (*) (*) (*) 0.0 0.0 (*) (*)

2019-20 (*) (*) (*) (*) 0.0 0.0 (*) (*)

540

2012 2013 2014 2015-16 2016-17 2017-18 2018-19 2019-20

Number of

licensees1192 1193 1120 1168 1168 1168 1168 1168

Application Fee $304.50 $177,850 $173,200 $168,347 $177,879 $177,879 $177,879 $177,879 $177,879Inspection Fee $400 $54,800 $60,000 $36,000 $51,407 $51,407 $51,407 $51,407 $51,407

$232,650 $233,200 $204,347 $229,285 $229,285 $229,285 $229,285 $229,285

Percentage of licensees that pay

inspection fees22% 23% 26% 16%

App. Fee Payors 584 569 553Ins. Fee Payors 137 150 90

($11,464) ($11,464) ($11,464) ($11,464) ($11,464)

($22,929) ($22,929) ($22,929) ($22,929) ($22,929)

($34,393) ($34,393) ($34,393) ($34,393) ($34,393)

HB 1305 - Exemption from Home Medical Equipment License and Inspection Fees

Middle: Assumes 10% of current licensees become

exempt

Impact:Low: Assumes 5% of

current licensees become exempt

High: Assumes 15% of current licensees become

exempt

541

REVENUE ESTIMATING CONFERENCE Tax: Other Taxes and Fees Issue: Intrastate Crowdfunding Bill Number(s): CS/CS/CS/HB 275, enrolled Entire Bill Partial Bill: Sponsor(s): Month/Year Impact Begins: July 1, 2015 Date of Analysis: 05/29/2015 Section 1: Narrative a. Current Law: In 2012, Congress enacted the Jumpstart Our Business Startups (JOBS) Act in an effort to ease regulatory burdens

faced by startups and small businesses in connection with capital formation. However, national equity crowdfunding is not permitted until the Securities and Exchange Commission (SEC) adopts final regulations. The SEC delay has prompted some states to enact their own intrastate crowdfunding legislation.

In Florida, the Securities and Investor Protection Act, ch. 517, F.S., regulates securities issued, offered, and sold in this state through the Florida Office of Financial Regulation’s Division of Securities (OFR). Dealers, associated persons, and issuers are prohibited from offering or selling unregistered securities unless they meet an exemption in s. 517.051, F.S., or s. 517.061, F.S., or are under the jurisdiction of the Securities and Exchange Commission.

b. Proposed Change: The bill creates an exemption from securities registration for equity crowdfunding if an issuer, intermediary

or broker-dealer, and purchaser meet certain requirements. Section 517.0611, cited as the “Florida Intrastate Crowdfunding Exemption,” requires the issuer to file a notice with the OFR before conducting any offering. The securities may be offered by general advertisement and can be sold to non-accredited investors through an intermediary or broker-dealer. However, the issuer and purchaser must reside in this state while the intermediary must be a natural person residing in this state, or legal entity registered with the Secretary of State to do business in this state, that facilitates the offer or sale of securities under the crowdfunding exemption.

1

Both the issuer, prior to offering securities, and the intermediary, if not a registered broker-dealer, must submit a $200 fee with the proceeds deposited into the OFR’s Regulatory Trust Fund. Additionally, the bill requires that intermediaries and their direct and indirect owners and principals submit fingerprints for state and national criminal background checks. The average cost of finger printing through a live-scan vendor authorized by the Florida Department of Law Enforcement is $65 consisting of a $24 state background check

2 and a $14.75 national background check.

3 The remainder of the cost is the vendor’s services.

4

Sales of a security may not exceed $1 million per 12-month period. Sales to an officer or a person owning more than 20 percent of the outstanding shares are not counted towards this limitation.

Section 2: Description of Data and Sources Alois, J. (2015, February 7). Washington DC Has First Equity Crowdfunding Campaign Under District Exemption, Crowdfund Insider. Retrieved May 28, 2015, from http://www.crowdfundinsider.com/2015/02/62353-washington-dc-has-first-equity-crowdfunding-campaign-under-district-exemption/ Clark, P. (2013, June 6). Kansas and Georgia Beat the SEC on Crowdfunding Rules. Now Others Are Trying. Retrieved May 28, 2015, from http://www.bloomberg.com/bw/articles/2013-06-20/kansas-and-georgia-beat-the-sec-on-crowdfunding-rules-dot-now-others-are-trying Cormick, A. (2015, April 16). Update #3: 22 U.S. States Have Adopted An Intrastate Equity Crowdfunding Exemption. Retrieved May 28, 2015, from http://www.alixecormick.com/update3-intrastate-equity-crowdfunding-exemptions/

1 Newly created subsection in section 517.021, F.S.

2 The proceeds are deposited into the FDLE’s Operating Trust Fund.

3 Proceeds forwarded to the Federal Bureau of Investigation.

4 Information contained in this portion of this analysis is from the staff analysis for CS/CS/CS/HB 275 by the House Regulatory Affairs

Committee (April 13, 2015).

x

542

REVENUE ESTIMATING CONFERENCE Tax: Other Taxes and Fees Issue: Intrastate Crowdfunding Bill Number(s): CS/CS/CS/HB 275, enrolled Texas State Securities Board. Registered Crowdfunding Portals. (n.d.). Retrieved May 28, 2015, from http://www.ssb.state.tx.us/Important_Notice/Registered_Crowdfunding_Portals.php Zeoli, A. (n.d.). STATE OF THE STATES – Comparative Summaries of Current Active And Proposed Intrastate Crowdfunding Exemptions (Updated). Retrieved May 28, 2015, from https://crowdfundinglegalnews.files.wordpress.com/2015/01/int-summary-enacted-5-15-parts-1-and-21.pdf Zeoli, A. (2014, September 30). STATE OF THE STATES: An Update On Intrastate Crowdfunding. Retrieved May 28, 2015, from http://www.crowdfundinsider.com/2014/09/51187-state-states-update-intrastate-crowdfunding Section 3: Methodology (Include Assumptions and Attach Details) Table 1, below, lists 22 states that currently provide an equity crowdfunding exemption similar to Florida’s. They all provide a mechanism whereby a non-accredited investor can participate in this market. The majority of exemptions were enacted within the past two legislative sessions. Georgia enacted its exemption in 2011 and through September 2014, 35 issuers used the exemption to offer an equity crowdfunding campaign to residents. Likewise, six issuers in Kansas utilized the intrastate equity crowdfunding exemption between 2011 and mid-2013. The other aspect of revenue generation in Florida is that of intermediaries. Texas enacted its law during their 2014 session. Since then, the Texas State Securities Board lists 7 registered crowdfunding portals. Table 1. Enacted Equity Crowdfunding Exemptions

State Year Enacted Participants

Alabama 2014

Arizona 2015

Colorado 2014

District of Columbia 2014 First crowdfunding campaign 2-7-2015

Florida 2015

Georgia 2011 35 issuers as of 9-30-2014

Idaho 2012

Indiana 2014

Kansas 2011 6 issuers as of 6-20-2013

Kentucky 2015

Maine 2014

Maryland 2014

Massachusetts 2015

Michigan 2013

Mississippi 2015

Oregon 2015

Tennessee 2015

Texas 2014 7 registered crowdfunding portals

Vermont 2014

Virginia 2015

Washington 2014

Wisconsin 2013

543

REVENUE ESTIMATING CONFERENCE Tax: Other Taxes and Fees Issue: Intrastate Crowdfunding Bill Number(s): CS/CS/CS/HB 275, enrolled Section 4: Proposed Fiscal Impact Based on the level of activity in other states, it is expected that the amount of fees collected each year will not exceed the insignificant threshold.

High Middle Low

Cash Recurring Cash Recurring Cash Recurring

2015-16 * *

2016-17 * *

2017-18 * *

2018-19 * *

2019-20 * *

List of affected Trust Funds: OFR’s Regulatory Trust Fund FDLE’s Operating Trust Fund Section 5: Consensus Estimate (Adopted: 06/03/2015): The Conference adopted the proposed estimate.

GR Trust Local/Other Total

Cash Recurring Cash Recurring Cash Recurring Cash Recurring

2015-16 * * * * 0.0 0.0 * *

2016-17 * * * * 0.0 0.0 * *

2017-18 * * * * 0.0 0.0 * *

2018-19 * * * * 0.0 0.0 * *

2019-20 * * * * 0.0 0.0 * *

544

REVENUE ESTIMATING CONFERENCE Tax: Board of Pharmacy Fees Issue: Immunization Certification Fees Bill Number(s): CS/HB 279 ENR Entire Bill Partial Bill: Sponsor(s): Rep Pigman Month/Year Impact Begins: July 1, 2015 Date of Analysis: May 28, 2015 Section 1: Narrative a. Current Law:

Section 465.189 F.S. requires pharmacists to apply to the Board of Pharmacy for immunization certification for a $55 fee and completion of 20 hours of coursework before administering vaccines to adults.

b. Proposed Change:

The bill allows a pharmacy intern to certify with the Board of Pharmacy to administer vaccines under the supervision of a pharmacist who is also certified to administer vaccines. The pharmacy intern must complete the same coursework and pay a $55 fee. The bill also allows additional vaccines to be administered by pharmacists and pharmacy interns. The following additional immunizations are authorized by the bill:

Measles, mumps, rubella (MMR);

Tetanus, diphtheria, pertussis (Td/Tdap);

Varicella;

Human Papillomavirus (HPV);

Hepatitis A;

Hepatitis B;

Haemophilus influenza type b (Hib); and

Vaccines recommended for international travel such as yellow fever.

Section 2: Description of Data and Sources Department of Health FY 13-14 data. Pharmacy License Application Detail

Section 3: Methodology (Include Assumptions and Attach Details) 30,636 pharmacists are registered by the Board and 37% are certified to administer vaccines. There are currently 10,914 registered interns. Approximately 1,499 new intern licenses are issued annually. The low estimate assumes 37% of existing and future pharmacy interns will seek vaccine certification. The low estimate assumes 50% of existing and future pharmacy interns will seek vaccine certification. Additionally, 5% of pharmacists will also seek the certification. The low estimate assumes 63% of existing and future pharmacy interns will seek vaccine certification. Additionally, 10% of pharmacists will also seek the certification. The analysis also assumes that pharmacy interns will not be required to recertify upon completion of their internship.

FY Applications Licenses Issued

10-11 1,481 1,451

11-12 1,437 1,426

12-13 1,495 1,461

13-14 1,855 1,612

14-15 1,645 1,545

X

545

REVENUE ESTIMATING CONFERENCE Tax: Board of Pharmacy Fees Issue: Immunization Certification Fees Bill Number(s): CS/HB 279 ENR

Price $55

High Medium Low

Assumptions 63% 50% 37%

Ph

arm

acy

Inte

rns

12,399 $429,625 $340,973 $252,320

1,499 $51,940 $41,223 $30,505

1,499 $51,940 $41,223 $30,505

1,499 $51,940 $41,223 $30,505

1,499 $51,940 $41,223 $30,505

High Medium Low

Assumptions 10% 5% 0%

Ph

arm

acis

ts 30,636 $168,498 $84,249 $0

0 $0 $0 $0

0 $0 $0 $0

0 $0 $0 $0

0 $0 $0 $0

Tota

l

0 $598,123 $425,222 $252,320

0 $51,940 $41,223 $30,505

0 $51,940 $41,223 $30,505

0 $51,940 $41,223 $30,505

0 $51,940 $41,223 $30,505

Section 4: Proposed Fiscal Impact Trust

High Middle Low

Cash Recurring Cash Recurring Cash Recurring

2015-16 $598,123 $51,940 $425,222 $41,223 $252,320 $30,505

2016-17 $51,940 $51,940 $41,223 $41,223 $30,505 $30,505

2017-18 $51,940 $51,940 $41,223 $41,223 $30,505 $30,505

2018-19 $51,940 $51,940 $41,223 $41,223 $30,505 $30,505

2019-20 $51,940 $51,940 $41,223 $41,223 $30,505 $30,505

List of affected Trust Funds: Medical Quality Assurance Trust Fund, subject to GR service charge Section 5: Consensus Estimate (Adopted: 06/03/2015) – The Conference adopted a positive indeterminate impact for the first year’s cash impact, and positive insignificant for the remainder of the forecast.

GR Trust Local/Other Total

Cash Recurring Cash Recurring Cash Recurring Cash Recurring

2015-16 ** * ** * 0.0 0.0 ** *

2016-17 * * * * 0.0 0.0 * *

2017-18 * * * * 0.0 0.0 * *

2018-19 * * * * 0.0 0.0 * *

2019-20 * * * * 0.0 0.0 * *

546

REVENUE ESTIMATING CONFERENCE Tax: Miscellaneous Fees Issue: Elimination of Longer Term Delinquent Fee Bill Number(s): Section 4 of CS/HB 401

Entire Bill Partial Bill: Sponsor(s): Magar Month/Year Impact Begins: July 1, 2015 Date of Analysis: May 28, 2015 Section 1: Narrative a. Current Law: The Division of Hotels and Restaurants (division) with the Department of Business and Professional Regulation

licenses public food service establishments and public lodging establishments under ch. 509, Part I, F.S. Public food service establishments and public lodging establishments are required to renew their licenses annually (s. 509.241, F.S.), and are assessed delinquent fees if the license is not renewed by the expiration date (s. 509.251, F.S.). Statute prescribes a maximum late fee of $50 for licenses renewed within 30 days after the expiration date and a maximum of $100 for licenses renewed more than 30 but not more than 60 days after the expiration date. Licenses expired more than 60 days are subject to an administrative complaint and a fine ranging from $250 to $1,000 (Rule 61C-1.005(6)(f), F.A.C.).

b. Proposed Change: Section 4 of the bill sets the delinquent license renewal fee at $50 for a license renewed within 60 days after

the expiration date. Licenses expired more than 60 days will still be subject to an administrative complaint/fine as prescribed in rule.

Section 2: Description of Data and Sources Legislative Bill Analysis from the Department of Business and Professional Regulation Annual Late fee Data from DBPR email

Section 3: Methodology (Include Assumptions and Attach Details) In Fiscal Year 2013-14, the division licensed 87,083 public food service establishments and public lodging establishments and collected approximately $632,764 in $100 delinquent fees. In Fiscal Year 2014-15, the division collected approximately $710,936 in $100 delinquent fees. From 2007 through 2012, the division collected an average of $661,564 in $100 delinquent fees annually. Assuming the average amount of $100 delinquent fees collected remains unchanged, the low estimate represents the revenue reduction based on the average amount of $100 delinquent fees collected from 2007-2012 ($661,564). Because the $100 fee is being reduced to $50, there will be half as much revenue collected from licensees who renew their license between 30-60 days after the expiration date. Note: this estimate is the same as the estimate performed in the DBPR bill analysis from regular session. $661,564 divided by 2 = $330,782 reduction in revenue High estimate represents the revenue reduction based on the most recent data, the estimated FY 2014-15 delinquent fees collected ($710,936 divided by 2 = $355,468 reduction in revenue). Section 4: Proposed Fiscal Impact

High Middle Low

Cash Recurring Cash Recurring Cash Recurring

2015-16 ($355,468) ($330,782)

2016-17 ($355,468) ($330,782)

2017-18 ($355,468) ($330,782)

2018-19 ($355,468) ($330,782)

2019-20 ($355,468) ($330,782)

X

547

REVENUE ESTIMATING CONFERENCE Tax: Miscellaneous Fees Issue: Elimination of Longer Term Delinquent Fee Bill Number(s): Section 4 of CS/HB 401

List of affected Trust Funds: Hotels and Restaurants Trust Fund Section 5: Consensus Estimate (Adopted: 06/03/2015): The Conference adopted the low estimate.

GR Trust Local/Other Total

Cash Recurring Cash Recurring Cash Recurring Cash Recurring

2015-16 (Insignificant) (Insignificant) (0.3) (0.3) 0.0 0.0 (0.3) (0.3)

2016-17 (Insignificant) (Insignificant) (0.3) (0.3) 0.0 0.0 (0.3) (0.3)

2017-18 (Insignificant) (Insignificant) (0.3) (0.3) 0.0 0.0 (0.3) (0.3)

2018-19 (Insignificant) (Insignificant) (0.3) (0.3) 0.0 0.0 (0.3) (0.3)

2019-20 (Insignificant) (Insignificant) (0.3) (0.3) 0.0 0.0 (0.3) (0.3)

548

FY $50 Fee < 31 Days $100 Fee > 30 Days Total

2007-2008 $116,771 $541,357 $658,128

2008-2009 $164,702 $802,719 $967,421

2009-2010 $268,687 $738,787 $1,007,474

2010-2011 $171,686 $651,164 $822,850

2011-2012 $203,200 $619,855 $823,055

2012-2013 $203,586 $615,503 $819,089

2013-2014 * $208,230 $632,764 $840,994

2014-2015 * $233,955 $710,936 $944,891

average 2007-2012 $188,105 $661,564 $849,670

average 2007-2014 $196,352 $664,136 $860,488

* Data provided by DBPR

Annual Late Fee Data From DBPR

* The breakdown of total late fees from 2013-2014 and 2014-2015 has been estimated due to

changes in the licensing system.

549